Applied Materials eye India; consider Tamil Nadu for chip manufacturing unit

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Applied Materials eye India; consider Tamil Nadu for chip manufacturing unit

Applied Materials eye India; consider Tamil Nadu for chip manufacturing unit

Industry News
Sep 10,24

The company may initially focus on developing an advanced AI-enabled technology centre in Chennai, creating 500 jobs, with potential future expansion into manufacturing.

Applied Materials eye India; consider Tamil Nadu for chip manufacturing unit

Applied Materials, the world’s second-largest fab toolmaker, is reportedly considering establishing a manufacturing unit in Tamil Nadu, driven by India’s growing semiconductor market and a strategic ‘China Plus One’ approach. The company, which posted $26.52 billion in revenue, has been exploring new markets as it adjusts to the shifting global semiconductor landscape, especially after losing its top spot to Dutch firm ASML.

With semiconductor demand in India expected to shift dramatically—60% of it projected to come from chips smaller than 10 nanometres by 2032—toolmakers like Applied Materials are looking to seize new opportunities. Industry insiders suggest the company may initially focus on developing an advanced AI-enabled technology centre in Chennai, creating 500 jobs, with potential future expansion into manufacturing.

The company’s decision to expand in India aligns with increasing government incentives, such as those provided under the Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS). Tamil Nadu is also offering generous subsidies, including up to 50% on capital expenditure and payroll reimbursements for semiconductor projects.

Applied Materials joins a growing list of companies establishing semiconductor manufacturing units in India. The Union Cabinet has already approved five semiconductor projects, including a $2.75 billion assembly and testing facility by Micron in Gujarat and Tata Electronics’ semiconductor fab in Dholera.

While Applied Materials has not confirmed specific plans for manufacturing, its expansion in India represents a significant step in strengthening the country’s semiconductor ecosystem.

(business standard)